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A Guide for Selecting Mutual Funds
Our service uses SEBI's Riskometer to help investors select mutual funds that match their risk appetite, providing additional guidance to ensure a well-rounded and informed investment choice.
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Navigating Mutual Fund Risks with SEBI's Riskometer
Given the vast array of mutual funds available, investors can utilize the new Riskometer provided by SEBI to select schemes that align with their risk tolerance. This tool is particularly beneficial for those who are new to mutual funds and unsure about which scheme matches their risk profile.
However, it is important to recognize that while the Riskometer provides a general indication of risk levels, many other factors should be taken into account when choosing a fund. The Riskometer should not be relied upon as the sole indicator.
Riskometer Label | Suitable Investor Type | Investor Persona |
---|---|---|
Low | Conservative | Investor’s top priority is the safety of capital. She/he is willing to accept relatively low returns against a low risk of principal. |
Moderately Low | Moderately Conservative | An investor is willing to accept a small level of risk in exchange for some potential returns over a medium to long-term. |
Moderate | Moderate | An investor can tolerate a moderate level of risk in exchange for relatively higher potential returns over a medium to long-term. |
Moderately High | Moderately Aggressive | Investor is keen to accept a relatively higher risk to maximize potential returns over the medium to long-term. |
High Risk | Aggressive | Investor is willing to accept a significant risk to maximize potential returns over the long term and is aware that she/he may lose a significant part of the capital. |
Very High Risk | Very Aggressive | Investor is willing to accept a significant high risk to maximize potential returns over the long term and is aware that she/he may lose a significant part of the capital. |